The number of sales are 4% higher than the pre-lockdown level rebounding in the northern cities of Leeds, Sheffield and Manchester.
Northern cities have seen the number of sales agreed rebound strongly up 4% compared to pe-lockdown levels according to the Zoopla Cities House Price Index with greater demand from first time buyers and home movers.
Buyer demand in the UK reduced 70% in March with lockdown and is up 46% as the property market reopens with the northern cities of Leeds, Sheffield and Manchester leading the recovery.
The number of homes for sale is -15% lower year-on-year for the top 20 cities and particularly weak in Bristol, Newcastle and Cambridge.
House prices higher due to demand
City houses prices are higher by 2.1% year-on-year which is lower than the UK average of 2.4% for the year but up on the start of the year with the post-election rise in market activity.
This Zoopla table shows in cities where the market is open, the change in the number of sales agreed this month compared to February 2020.
| City | Current price | Sales agreed |
|---|---|---|
| Leeds | £169,700 | 21.0% |
| Sheffield | £138,900 | 15.9% |
| Manchester | £173,700 | 7.8% |
| Nottingham | £158,400 | 7.2% |
| Bournemouth | £188,900 | 6.1% |
| Liverpool | £122,300 | 5.4% |
| Portsmouth | £122,600 | 5.1% |
| Oxford | £240,000 | 3.1% |
| Leicester | £184,000 | -6.5% |
| London | £478,100 | -9.6% |
| Bristol | £281,400 | -12.6% |
| Newcastle | £127,400 | -13.1% |
| Southampton | £227,000 | -22.7% |
| Cambridge | £412,800 | -23.9% |
Even with higher asking prices pent up demand during lockdown has seen the number of sales agreed compared to February 2020 rise with Leeds 21.0% higher and Sheffield up 15.9%.
Cities that are struggling to recover are Cambridge with number of sales agreed down -23.9% and Southampton lower by -22.7% compared to February.
Housing stocks with estate agents remain low as there was no new supply of homes during the lockdown and this has helped to boost asking prices on Zoopla by 7% compared to a year ago.
The lack of suitable properties for home movers means they may remain in their current home and saving for a bigger deposit and wait for the market to improve.
For equity release buyers, higher house prices allows them to release cash securing fixed rates from 2.5% upwards and use this to improve your quality of life or buy a more expensive home.
Housing demand starting to fall
Although demand for housing is 46% higher than at the start of March it has begun to weaken in the last two weeks and is -8% lower than 11 June.
Zoopla expects demand for housing to continue to weaken over the summer as the economic impact of Coronavirus develops and the levels of unemployment rise across the country.
Interest rates are currently very low although this is not a benefit to homebuyers with deposits of 10% or less as lenders have withdrawn these products due to the economic risks.
These new limits on low deposits from lenders does not apply to buy-to-let landlords as they must have at least 25% deposit and demonstrate a suitable level of rental income.
About a fifth of homebuyers have less than 10% deposit which will impact demand with fewer first time buyers able to buy, although the government is likely to find new ways to support the market.
For remortgage buyers with equity in their property at the end of their mortgage deal, they could release further capital and benefit from low referential interest rates which they can use to improve their home.
What are your next steps?
Call our LCM mortgage brokers if you are a buy-to-let landlord with a property, remortgaging and want the best mortgage deal, buying your first home or you are planning to move home.
For equity release buyers our London City Mortgage advisers can recommend lifetime mortgages allowing you to receive cash from your home to gift a family member or friend or pay for care at home.
Start with a free mortgage quote or call us and we can take your details. Learn more by using the mortgage monthly cost calculators, property value tracker chart and equity release calculator.
